The CFPB has published a compliance bulletin and policy guidance on medical debt collection and consumer reporting requirements under the No Surprises Act.
The law unsurprisingly sets out requirements that apply to certain people who receive care from an out-of-network provider that provides emergency services, inpatient services at an in-network facility, or air ambulance services. The Act applies to Medicare years beginning on or after January 1, 2022.
FDCPA. In the bulletin, the CFPB cautions debt collectors about the intersection of certain prohibitions of the Fair Debt Collection Practices Act (FDCPA) and the No Surprises Act. In particular, the CFPB indicates that the FDCPA’s prohibition on the use of “false, misleading, or deceptive” representations includes the misrepresentation that a consumer owes a debt arising from a charge that exceeds the amount permitted by the law without surprises. He also notes that courts have found that collecting an amount that exceeds what is owed could violate the FDCPA’s prohibition on using “unfair or unreasonable means” to collect a debt.
Credit reports. In the bulletin, the CFPB also cautions consumer reporting agencies (CRAs) and providers of unpaid medical debt information to CRAs about the intersection of the Fair Credit Reporting Act (FCRA) and Regulation V and the law without surprises. The CFPB reminds CRAs and vendors of the following FCRA/Regulation V requirements:
- When preparing a consumer report, CRAs must follow procedures to ensure maximum accuracy of the information reported;
- Suppliers must establish and implement reasonable procedures regarding the accuracy and integrity of the information they provide to CRAs; and
- Credit rating agencies and vendors must make reasonable and timely inquiries into consumer disputes to verify the accuracy of the information provided.
The CFPB advises rating agencies and providers that these accuracy and challenge requirements apply to liabilities resulting from charges that exceed the amount permitted by law without surprises. Accordingly, a provider of information to a CRA indicating that a consumer has a debt resulting from out-of-network charges, or a CRA that includes such information in a consumer report, may violate the FCRA and Regulation V if the amount of charge exceeds the amount allowed by the No Surprises Act or if the provider or the CRA fails to meet its litigation obligations.
It is important to assess what steps can be taken to reduce the risk of potential liability for the types of claims described above when collecting or providing medical debt information. Attorneys in Ballard Spahr’s Benefits and Executive Compensation and Health Law practice groups advise clients on the law and rules without surprise and closely monitor related developments. Members of these groups recently posted a briefing on the rules of the No Surprises Act and report regularly on the progress of the cabinet’s health care reform dashboard. They are available to work with members of the company’s Consumer Financial Services Group who regularly provide advice on debt collection and FCRA compliance issues.